Costa Rica expands VAT to include AI and travel digital services

Costa Rica has expanded its list of digital services subject to a 13% Value Added Tax (VAT), effective Tuesday, September 8. The Ministry of Finance updated its registry to include 181 cross-border services, many of which are related to the recent rise of artificial intelligence.

New additions to the tax list include AI platforms such as OpenAI (ChatGPT), Claude, Anthropic, and Grok. Other newly included services cover travel and lodging, such as Booking.com, Agoda.com, and Expedia, as well as entertainment and gaming platforms like PlayStation Network and Nintendo.

Revenue Deputy Minister Víctor Carvajal stated that while this is not a new tax—as Costa Rica has taxed cross-border digital services since October 2020—the update reflects technological dynamism. For final consumers, the measure will result in a direct 13% increase in the price paid for these services. For taxpayers, the tax is creditable and does not represent an increase in costs.